Theres are two opposing forces which drive corporate culture - the gravitation to working to a trusted formula, and the pull towards the possibility of doing something not done before. The former offers the reassurance of familiarity and control, the latter the excitement of innovation and risk. The important element is knowing how to manage the tension between the two forces to best effect.
Too much emphasis on the former usually results in commodity-oriented products (and profit margins), where the phrase "value engineering" has been taken to mean squeezing out every unnecessary cost (and often every differentiating feature of a product). As a manager, you may not get fired for it, but you may not inspire your customers either.
The world of real-estate development has for years relied too heavily on the assumption that because each location is unique, so too will be the product. The largely one-off nature of the purchase (as opposed to other sectors where the need to maintain brand loyalty is critically important) has also reduced the perceived need to create genuine distinction in the marketplace by understanding specific customer needs and answering them.
The sector could do well to adopt the practice of "imagineering" instead. Best known as the name given to the division of Walt Disney that is responsible for the creation and construction of Disney's theme parks, stores, hotels and cruises, the phrase was originally used by the aluminium manufacturer Alcoa to describe its corporate focus: "Imagineering is letting your imagination soar, and then engineering it down to earth"
WDI (Walt Disney Imagineering) always start with the premise that if it can be dreamt, it can be built. Although the company sees itself in "the magic business", it is also currently in the business of managing two vast $10bn design and construction projects (the re-development of its parks in Florida and California). What's interesting is its development process. It dreams up the ideal end experience first, by focusing on seeking to fulfil specific customer needs and create specific moods. The company wholly embraces the notion of blue sky speculation before ever addressing the practicalities of construction.
Real-estate developers would do well to adopt more of the approach used so effectively by Disney. Combining imagination and a clear understanding of the customer with a desire to create a uniquely desirable end product, can have a profound effect on the success and value of a project.
Totality has worked on a number of real-estate projects to help imagineer highly distinctive (and more profitable) schemes. We transformed the thinking of one client who was set to install a swimming pool in a residential development - a feature expensive to construct, with service charge implications post-completion, and not especially distinctive within the marketplace. Instead, we conceived a totally unique rooftop running track and resident facilities. Installed at minimal cost (and with very maintenance costs thereafter), this feature became the focus of the marketing, highly appealing to the target customer, and the basis for an additional 10% in GDV.
More recently on behalf of St James for their central London scheme Riverlight, our recommendations to create a suite of resident club facilities were interpreted by the interior architects into a unique triple-height clubhouse - a core element of the selling story which is achieving above-target sales values and sales rate.
This article is a summary of how Totality's customer needs focused approach can create greater market distinction and add value.